Leases

12 Months Ended

Dec. 31, 2021

14. Leases

The Company has operating leases for corporate offices with initial lease terms ranging from one-year to 15 years. Certain leases contain options to extend the initial term at the Company’s discretion. The Company accounts for the option to extend when it is reasonably certain of being exercised. The Company’s lease agreements do not contain any material residual value guarantees, restrictions or covenants.

The following table presents the components of occupancy expense for the years ended December 31, 2021, 2020, and 2019:


		Year Ended December 31,
Lease cost:	Classification	2021			2020			2019
		(In thousands)
Operating lease cost	Occupancy	$	13,202		$	13,455		$	10,875
Operating lease cost for subleased/assigned properties	Other, net		2,054			2,404			2,422
Variable lease costs	Occupancy		13			26			169
Sublease income for subleased/assigned properties	Other, net		(2,079	)		(2,420	)		(2,422	)
Net lease cost		$	13,190		$	13,465		$	11,044

The Company determines whether an arrangement is, or includes, a lease at contract inception. Operating lease right-of-use assets and liabilities are recognized at commencement date and are initially measured based on the present value of lease payments over the defined lease term. As the Company’s leases do not provide an implicit rate, the Company used its incremental borrowing rate based on the information available at the adoption date in determining the present value of lease payments.

The weighted average remaining lease term and weighted average discount rate are as follows:


	As of December 31,
Lease Term and Discount Rate	2021			2020
Weighted average remaining lease term (in years)		11.5			12.3
Weighted average discount rate		5.9	%		5.9	%

The following table presents the maturity of lease liabilities as of December 31, 2021:


	(In thousands)
2022	$	11,163
2023		10,823
2024		11,281
2025		11,086
2026		10,984
2027 and thereafter		68,065
Total lease payments		123,402
Less: interest		34,977
Present value of lease liabilities	$	88,425

The Company has entered into agreements to sublease or assign the Company’s lease obligations on two properties to third parties and is contingently liable should the third parties default on future lease obligations through the lease termination dates of February 2022 and May 2022. The aggregate amount of the future lease obligations under these arrangements is $0.3 million as of December 31, 2021.